Using regulatory reports to improve your business processes and revenue

Often, companies view regulatory compliance as a simple obligation to avoid penalties and fines. However, have you thought about how compliance can not only improve your business processes, but also increase your revenue? In this article, we’ll walk you through the different ways you can use your regulatory reporting data to benefit your business.

Understand product demand

Data obtained from regulatory reports allows you to easily see which asset classes your clients are trading the most or not trading at all. This information will help you tailor your products to customer demand, saving you product expenses (especially expensive data streams and server space) with little or no return. In addition, understanding product demand can better inform your company’s communication and marketing strategies, especially in terms of very expensive and competitive paid advertising. This minimizes the risk of ineffective promotional activities by targeting and encouraging commerce for your most popular products.

Spot your weaknesses

The process and sustained discipline of producing daily data exports can identify gaps which, when corrected, can lead to improvements in other parts of the business. The ability to produce daily reports allows you to identify deficiencies in your internal and outsourced processes. It is not uncommon that oversight of these processes can result in non-compliance, as was the case with the ASIC infractions issued to AMP Capital and AMP Life in 2020 for ‘serious deficiencies in internal and outsourced processes and procedures’ of AMP to monitor the accuracy of its reports’. Resolving any shortfalls in your operations will improve the efficiency and accuracy of your reporting and reduce the burden on your compliance resources.

Eliminate unnecessary losses

Using best execution monitoring can help identify trades that indicate scalpers or significant slippage, allowing you to quickly take appropriate action to eliminate associated financial losses. Depending on the monitoring system and procedures in place at your business, you should at least be able to analyze and compare your trade data with market benchmark data or data from your previous trades to calculate benchmarks. that allow for consistent and fair performance assessment. The ability to quickly and effectively identify trade execution that is outside of your execution parameters and market prices is critical to minimizing financial loss.

Stay competitive in a growing market

As trading platforms such as eToro and Robinhood continue to enter the market with “zero brokerage” and “payment for order flow” fee structures, it is becoming increasingly difficult for traditional brokers to maintain a competitive advantage. In contrast, regulatory reports are a barrier to entry for many new brokers due to their complexity. New market entrants are often discouraged by the high costs associated with both unboxing and regulatory compliance in the early stages of business operations. This means that established brokers with concrete compliance frameworks and regulatory reporting processes will face less competition. Thus, the potential loss of customers to new competitors is minimized.

If you are overwhelmed with your reporting obligations, we strongly recommend that you consider outsourcing your obligations to a third party delegated reporting service provider. These service providers have expertise in multi-jurisdictional regulatory reporting, which not only helps ensure that you are compliant, but also maximizes the productivity and efficiency of your business.

Often, companies view regulatory compliance as a simple obligation to avoid penalties and fines. However, have you thought about how compliance can not only improve your business processes, but also increase your revenue? In this article, we’ll walk you through the different ways you can use your regulatory reporting data to benefit your business.

Understand product demand

Data obtained from regulatory reports allows you to easily see which asset classes your clients are trading the most or not trading at all. This information will help you tailor your products to customer demand, saving you product expenses (especially expensive data streams and server space) with little or no return. In addition, understanding product demand can better inform your company’s communication and marketing strategies, especially in terms of very expensive and competitive paid advertising. This minimizes the risk of ineffective promotional activities by targeting and encouraging commerce for your most popular products.

Spot your weaknesses

The process and sustained discipline of producing daily data exports can identify gaps which, when corrected, can lead to improvements in other parts of the business. The ability to produce daily reports allows you to identify deficiencies in your internal and outsourced processes. It is not uncommon that oversight of these processes can result in non-compliance, as was the case with the ASIC infractions issued to AMP Capital and AMP Life in 2020 for ‘serious deficiencies in internal and outsourced processes and procedures’ of AMP to monitor the accuracy of its reports’. Resolving any shortfalls in your operations will improve the efficiency and accuracy of your reporting and reduce the burden on your compliance resources.

Eliminate unnecessary losses

Using best execution monitoring can help identify trades that indicate scalpers or significant slippage, allowing you to quickly take appropriate action to eliminate associated financial losses. Depending on the monitoring system and procedures in place at your business, you should at least be able to analyze and compare your trade data with market benchmark data or data from your previous trades to calculate benchmarks. that allow for consistent and fair performance assessment. The ability to quickly and effectively identify trade execution that is outside of your execution parameters and market prices is critical to minimizing financial loss.

Stay competitive in a growing market

As trading platforms such as eToro and Robinhood continue to enter the market with “zero brokerage” and “payment for order flow” fee structures, it is becoming increasingly difficult for traditional brokers to maintain a competitive advantage. In contrast, regulatory reports are a barrier to entry for many new brokers due to their complexity. New market entrants are often discouraged by the high costs associated with both unboxing and regulatory compliance in the early stages of business operations. This means that established brokers with concrete compliance frameworks and regulatory reporting processes will face less competition. Thus, the potential loss of customers to new competitors is minimized.

If you are overwhelmed with your reporting obligations, we strongly recommend that you consider outsourcing your obligations to a third party delegated reporting service provider. These service providers have expertise in multi-jurisdictional regulatory reporting, which not only helps ensure that you are compliant, but also maximizes the productivity and efficiency of your business.

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